Private Label Market Share Sets a New Record

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June 28, 2011

Store brands capped a decade of powerful growth with sales increases across all three major retail channels in 2010, and pushing dollar market share to an all-time high in supermarkets, drug stores and total outlets, according to PLMA’s 2011 Private Label Yearbook.

The PLMA Yearbook tracks private label sales and market share trends based on data from The Nielsen Company.

As shoppers’ economic concerns eased somewhat in the wake of the recession, some industry observers predicted that store brands would give up their recent gains, or even decline as the economy rebounded. To the contrary, store brands held onto the gains and even built on them.

In 2010, private label sales increased more than 2 percent in U.S. supermarkets and more than 5 percent in drug chains. Over the past decade, annual sales of private label products have increased by upwards of 40 percent in supermarkets and by 96 percent in drug stores.

In total outlets -- comprised of U.S. supermarkets, drug stores and mass merchandisers, including Walmart -- private label sales increased by nearly 2 percent while dollar share advanced by almost half a point to a new record high of $88.5 billion, according to The Nielsen Company.

For total outlets, store brands dollar share rose to 17.4 percent and unit share came in at 21.8 percent, with store brands dollar share advancing to a record 19.1 percent in supermarkets on unit market share was 23.5 percent. In drug stores, store brands advanced in dollar share to 14.7 percent and recorded unit share of 16.2 percent.

An estimated $15 to $20 billion in additional private label sales in retail channels that are not reporting to the Nielsen databases -- such as warehouse clubs, limited assortment stores, convenience stores and dollar stores -- would likely have produced a grand total exceeding $100 billion for 2010, according to PLMA.

The data also offer evidence of extreme efforts by national brand marketers in 2010 to recapture some of the market share they lost to store brands over the previous years, PLMA said. In particular, elevated promotional spending and short-term price cuts by national brands may have hedged the erosion of unit sales at the cost of any and all growth when it came to dollar sales. Indeed, it was highly unusual, if not unprecedented, that in supermarkets national brands were negative (minus 0.1 percent) in year-to-year dollar sales, while their unit sales were up a by modest 1 percent, PLMA said in a statement.

Data for PLMA’s 2011 Private Label Yearbook was compiled by The Nielsen Company for the 52 weeks ending December 25, 2010, with “total outlets” including Walmart stores.

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